Letter from Wallace

FSCJ President Steve Wallace sent a letter on June 24, 2012 to Florida Times-Union Editor Frank Denton asking him to “please, please ‘call off the dogs’” in the newspaper’s investigation - and to keep the letter private.

Denton responded that any letter Wallace wrote on behalf of the college was a public record, and that the paper has a responsibility to investigate and report responsibly.

The Florida State College at Jacksonville board of trustees terminated its contract with former president Steve Wallace on Tuesday after learning he has been investigated for abusing leave time and ethics violations.

The board voted 7-1 to terminate the contract Wallace was given after he stepped down in October amidst criticism over his spending and college operational problems. The exit contract was worth more than $1 million and would’ve given Wallace continued salary and benefits through December.

The new revelations came in part from the report issued last month by the Inspector General’s Office, which found Wallace may have violated state ethics laws by failing to disclose gifts and had few controls on his and other employees’ expense spending.

On Tuesday, the first board meeting since the inspector general’s report was released, the college’s general counsel Jeanne Miller told the board that Florida Department of Law Enforcement detectives also interviewed staff about Wallace’s use of compensatory time, based on information Chief Inspector General Melinda Miguel’s team learned during its investigation, which Gov. Rick Scott ordered in October.

Wallace took 178 days of unauthorized “comp time” over 15 years, according to FSCJ’s attorney and human resources director, and he counted weekend meetings, retreats and even overseas trips as comp days. Before he stepped down in October, he was paid out for nearly a year’s worth of unpaid leave.

“This was the first month we had the information to make an evidence-based decision, and we did,” said trustee Candy Holloway, who called a failed vote in November to terminate Wallace’s contract and moved again to cancel it Tuesday.

Longtime trustee Thomas “Mac” McGehee Jr. was the only opposing vote.Since the consulting arrangement began in January, records show, Wallace attended a handful of community meetings and wrote about six pages worth of reports about the history of the college and its goals.

Taking 'comp' time

During interviews with FSCJ staff, Miguel’s team learned that Wallace had been using “compensatory time” to take leave in December as the final days of his 15-year presidency came to a close. Wallace, who made about $514,000 a year in total compensation, was an exempt employee not eligible for overtime or compensatory time. He had 36 vacation days per year.

Miguel left the compensatory issue out of her report at the FDLE’s request, according to Miller.

“We’ve been fully cooperating with the FDLE,” Miller said. “It is our understanding the matter has been referred to State Attorney Angela Corey’s office for review. We have no information regarding the status.”

Corey’s spokeswoman, Jackelyn Barnard, did not return a call for comment.

Wallace’s attorney David Wells, could not be reached, and a call to Wallace’s home was not returned.

The only documentation for Wallace’s compensatory time was in a Word document Wallace asked his secretary to manage, according to college officials.

The record goes back to 1997, Wallace’s first year at the college, and shows he counted weekends he was at conferences, leadership retreats and even international trips as “comp days” he would take up to two years later as a paid day off instead of using vacation leave.

It’s common at FSCJ and other colleges to use flex time, according to Chris Arab, vice president of human resources. For example, an administrator with a late meeting Monday may leave early on Friday. But there was no board rule or anything in Wallace’s contract that allowed him to accrue comp time while working as a salaried college president who left with the second-highest compensation package in the state college system.

But what Wallace did have was a provision in his contract that he could accrue his vacation time without a cap and get paid out for the time at his current pay rate. He asked for and received nearly $337,000 in payout for 2,052 hours of vacation in October at more than $1,300 per day.

Some of the trips that he considered comp days were trips to Bangkok and Ireland — the same trips that the Inspector General’s Office found may constitute a violation of the state’s ethics laws, because he accepted the trips from the Jacksonville Chamber of Commerce and the Rotary Club but never disclosed the gifts.

The college’s foundation also donated money to these same charities after they solicited Wallace for donations.

Miguel said her office reviewed the Florida State College Foundation’s expenditures for five years and the policies that dictated the college and foundation’s expense spending. The Florida State College Foundation’s board approved several new policies in December to improve oversight after the investigators interviewed foundation staff.

Faulty record keepingThe report found faulty record keeping that often offered no proof that spending benefited the college. The inspector general also found concern with several of Wallace’s trips, which were considered “line of duty” but were never disclosed as gifts as the law requires of public officials. Basic accounting principles were also not being followed, the report showed, and the college and foundation’s checkbooks were each managed by a single person.

The Times-Union reported last July that Wallace charged $187,000 to the college and its foundation over two years, including meals, travel and technology expenses. Wallace’s expenses often lacked documentation and appeared to be approved by Wallace’s office manager with a signature stamp, the Times-Union reported.

Miguel recommended changes to policy to clarify reporting requirements and said the foundation should require supporting documents and receipts.

An internal audit function should also be reinstated, the report said.

McGehee, the only trustee to vote against terminating the contract, said he thought the board should wait to see if a criminal charge is brought or if ethics violations are proven before cancelling Wallace’s agreement.

“Without giving anyone an opportunity to discuss it, to defend it ... for us to react this way gives the appearance there was an agenda in place prior to this,” McGehee said.

Jimmie Mayo, who was elected chairman of the board Tuesday, said he was amazed by the comp time issue — “the result of which is thousands of dollars being paid directly to Dr. Wallace which his contract did not allow to be paid.”

But Mayo, who was a trustee when Wallace was first hired in 1997 and appointed again this year, said Wallace accomplished much. But the focus now needs to be on the college, and attracting a new president committed to solid governance.

What do you expect when you put the fox in charge of the henhouse? The thing that bothers me is that all of this was going on for years, with no apparent oversight, and when there is a public outcry, we THEN start to look at the legalities and ethics involved? I hope we, as taxpayers, are able to recoup some of this blatant theft of money... I hope Wallace saved his because he is going to need it for his attorney...maybe he can teach GED classes to his fellow inmates while he is in prison?

Well, Stevie Boy...... Finally, someone has awoke, you will soon meet your faith, hopefully the next picture we the public see of you will be in a finely crafted green suit with "W" on it, followed by a combination of numbers identifying you as a resident of the Bay Street Motel. Once a thief, always a thief........

Wally's dishonesty permeated the entire FSCJ leadership team in both the administrative offices and at the campus level. Those dean's, who caused the loss of millions of taxpayer dollars due to Financial Aid irregularities and as a by product, the loss of close to 100 positions at FSCJ to help cover the cost of their ineptitude, are still employed at FSCJ. The positions eliminated were primarily career employees, not administrative. In a nutshell, the administrators who made the bad decisions are all still in positions of power and this proves that nothing ever really changes at FSCJ.

This should not surprise anyone given that Wallace had clearly violated public trust repeatedly. I cannot agree with Mr.Mayo's assertion that Wallace accomplished a lot because ultimately he he hurt more individuals than he helped and he damaged the reputation of the institution more than what he contributed to its development. This is once again an example of hiring a marginal individual who practiced questionable ethics without oversight by a responsible governing body. He manipulated his way into the fabric of the community garnering acclaim from the Chamber of Commerce and the downtown Rotary. Denton showed real character when he refused to be intimidated by the Chamber and Rotary leadership.

For me this is all about weak Boards whether they are elected or appointed. The lack of leadership by the FSCJ Board is similar to the DCPS Board. There is no rationalization or excuse for Wallace's unprofessional if not criminal behavior and there is no room for incompetent Board members who create the environment that allows the culture of distrust to ferment.